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Massachusetts lawmakers OK $31 billion budget

NEW YORK (Reuters) - The Massachusetts legislature enacted a nearly $31 billion budget on Friday, which shuts a $1.9 billion budget gap without raising taxes by cutting spending and relying on one-time revenues.

Democratic Massachusetts Senate President Therese Murray, in a joint statement with the House Speaker, said the budget "includes unfortunate, but necessary savings."

Massachusetts, like most U.S. states has a July 1 budget deadline. Democratic Governor Deval Patrick on Tuesday signed into law an interim $1.25 billion budget to fund the government through July 10.

That is the deadline for him to review the legislature's budget plan and decide on any vetoes.

Patrick's interim budget protects Massachusetts from a shutdown that could have occurred had the legislature not come to agreement by the start of the new fiscal year as Minnesota did.

One feature in the Massachusetts legislative budget is a program to help counties, cities and towns cut health insurance costs for public employees.

As long as the plans' features do not cost more than the health insurance program for state workers and legislators, municipalities can "alter co-payments, deductibles," and other items, the statement said.

States and cities nationwide, trying to make up for still-soft revenues, are squeezing payroll and benefit costs. Some states, including Wisconsin and New Jersey, have fought to curb collective bargaining.

The Massachusetts legislature cast its new health plan for municipalities as a middle-of-the-road approach, that ensured "that employees and retirees have a strong voice without a veto."

Unlike New York state, which is closing 7 underused prisons, the Massachusetts legislature said it included $525 million for its Department of Corrections to prevent any closures.

(Reporting by Joan Gralla, editing by Gary Crosse)

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